1906.

DANIEL

V.

DANIEL.

Isaacs J.

a matter of course that the decree should carry with it for her H. C. OF A. the custody of the children; and that, having shown good cause for severing the conjugal tie, she, not being in fault herself, should not be amerced or punished by being deprived of the custody of the children. His Lordship said this:- My Lords, I should greatly regret that any general rule, so sweeping, and, as it appears to me, so inconvenient in its working, should be laid down on a subject of this description. It appears to me that the Act of Parliament has given the Court the widest and the most general discretion, and has purposely done so; and I think it must be the duty of the Court to consider all the circumstances of the particular case before it-the circumstances of the misconduct which leads to a separation no doubt-the circumstances of the general character of the father-the circumstances of the general character of the mother-and, above all, it should be the duty of the Court to look to the interest of the children, and carefully to weigh the comparative advantages or disadvantages of giving the custody of all or any of them to the one parent or to the other. I am at a loss to conceive how any general rule upon such a subject can be laid down. Certainly I should prefer to ask your Lordships to act, not upon any general rule, but upon the circumstances of the case now before us." It seems to me that is, as nearly as you can frame it, a statement of the principles by which Courts should be guided in the exercise of their discretion. The legislature thought fit to impose no definite rule for the exercise of the discretion of the Court, and if the circumstances of this case are looked at as we should expect them to be looked at, then I think it is clear that the Court has in this case done its duty, and exercised its discretion in a judicial manner, and that no sufficient grounds have been shown for disturbing the decision.

Special leave refused. Appeal dismissed

with costs.
of deposit.

Costs not to exceed amount

Proctor, for appellant, H. T. Morgan.
Proctor, for respondent, T. J. Dickson.

C. A. W.

[HIGH COURT OF AUSTRALIA.]

W. SCOTT, FELL AND COMPANY, LIMITED APPELLANTS ;

H. C. OF A. Action on contract-Sale of goods-Equitable plea-Contract induced by concealment

1906.

SYDNEY,

Dec. 10, 11.

Griffith C. J.,
Barton and
Isaacs JJ.

of material facts-Fraud.

In an action by a purchaser against a vendor for non-delivery on a contract for the sale of coal which the vendor had previously contracted to buy from a colliery company, the defendant pleaded, as a defence upon equitable grounds, that before the making of the contract sued upon the colliery company with whom he had contracted for the supply of the coal had agreed with other persons not to supply coal for shipment to South Australia except to those persons, and had accordingly refused to supply coal to the plaintiffs for that purpose, and the plaintiffs, by fraudulently concealing from the defendant those facts and the fact that they intended to ship the ccal in question to South Australia, induced the defendant to enter into the contract sued upon, and the colliery company refused to deliver the coal, at the defendant's order, to the plaintiffs, which was the non-delivery sued for, and the defendant thereupon repudiated the contract. There being no allegation to the contrary in the plea, it was to be assumed as against the defendant that the agreement by the company not to supply coal was subsequent to the contract of sale between the company and the defendant.

Held, that the facts alleged to have been concealed by the purchasers from the vendor were not such as the purchasers were bound by any duty to disclose, and therefore the mere non-disclosure of them did not, under the circumstances alleged, amount to fraudulent concealment such as would entitle the vendor, either in law or in equity, to be relieved from performance of the contract, and the plea was bad.

Decision of the Supreme Court: Scott, Fell & Co. v. Lloyd, (1906) 6 S.R. (N.S.W.), 447, reversed.

APPEAL from a decision of the Supreme Court of New South H. C. OF A. Wales.

1906.

FELL & Co.

LTD.

υ.

LLOYD.

The appellants brought an action against the respondent claim- W. SCOTT, ing damages for breach of a contract to sell to the appellants a quantity of coal which he had previously contracted to buy from the Abermain Colliery Company Limited. The respondent pleaded, inter alia, an equitable plea setting up that before the date of the contract sued upon the Abermain Company had, to the knowledge of the appellants, agreed with certain other persons not to supply coal to anyone but those persons for shipment to South Australia, and that the Abermain Company had accordingly refused to supply coal to the appellants for shipment to that State, that the respondent was unaware of this, and that the appellants, by fraudulently concealing from the respondent these facts as well as the fact that they desired to have the coal for shipment to South Australia, induced the respondent to enter into the contract sued upon, and that the Abermain Company had refused to supply to the appellants the coal they had agreed to sell to the respondent, which was the alleged breach, and that the respondent within a reasonable time of his discovery of the facts alleged to have been concealed from him had repudiated the contract sued upon and given notice of repudiation to the appellants.

The appellants demurred to the plea on the grounds that it did not allege that the contract between the respondent and the Abermain Company was made subsequently to the agreement not to supply coal for shipment to South Australia, or that the contract between the respondent and the Abermain Company disentitled the respondent to have delivered to him for shipment to South Australia the coal that company had agreed to sell to him, or that the Abermain Company had rightfully refused to deliver the coal under their contract with the respondent, and that the facts alleged did not entitle the respondent to repudiate the contract, or disclose any duty upon the appellants to inform the respondent of the facts alleged to have been concealed, or constitute a fraudulent concealment.

The Supreme Court overruled the demurrer, and ordered

H. C. OF A. judgment on the demurrer to be entered for the respondent: Scott, Fell & Co. v. Lloyd (1).

1906.

W. SCOTT,

It was from this decision that the present appeal was brought FELL & Co. by leave of the High Court.

LTD.

v.

LLOYD.

The material portions of the pleadings are more fully stated in the judgments.

Broomfield (Chubb with him), for the appellants. The facts alleged in the plea disclose no obligation on the part of the plaintiffs to inform the respondent of the matters alleged to have been concealed. This was not a contract uberrimae fidei. The vendor must look out for himself. There is nothing inequitable in holding the respondent to his bargain. He had his action against the Abermain Company for breach of their contract to supply the coal as agreed, and the appellants were entitled to assume that the Abermain Company would carry out that contract, which was an open one, containing no stipulation against shipment to South Australia. There was no fiduciary relationship between the appellants and the respondent, and, therefore, there was no duty to disclose the facts mentioned in the plea: Story, Equity Jurisprudence, 2nd ed., sec. 204, p. 131. Mere omission to disclose is not a fraudulent concealment, if the purchaser does nothing actively to mislead: Walters v. Morgan (2); Fox v. Mackreth (3); Turner v. Harvey (4); Coaks v. Boswell (5).

The plea

Rolin (Barton with him), for the respondent. sufficiently discloses a fraudulent concealment. It was material for the respondent to know that the appellants intended to ship the coal to South Australia. Not knowing that, or that the appellants had been refused by the Abermain Company, he was not aware of the risk of the latter company refusing to supply the coal. Even though the Abermain Company were bound in law to fulfil the contract, it might have been necessary for the respondent to bring an action for its enforcement. A duty lay on the appellants to inform the respondent of the facts, because he, being ignorant of them, was also ignorant of the existence of

(1) (1906) 6 S.R. (N.S. W.), 447.

(2) 3 De G., F. & J., 718.

(3) 2 Bro. C.C., 400.

(4) Jac., 169.

(5) 11 App. Cas., 232, at p. 235.

1906.

They W. SCOTT,

FELL & CO.
LTD.

any reason for hesitation, and could not be expected to make H. C. or A. inquiries. The appellants knew of the risk, and deliberately led the respondent into it, knowing that he was unaware of it. were guilty of fraud in not making it known to him, and so not giving him an opportunity of protecting himself. The promisor is not bound to fulfil his promise in a sense in which the promisee knew, at the time the contract was made, that the promise was not intended: Smith v. Hughes (1).

A non-disclosure, which leads the promisor into making a promise he would not have made if there had been a disclosure, is equivalent to fraudulent concealment.

Counsel for the appellants were not called upon in reply.

v.

LLOYD.

Cur, adv. vult.

GRIFFITH C.J. This was an action for non-delivery of coal under December 12th. a contract, alleged to be for the sale of coal, and which according to the declaration was as follows:-" That the defendant should sell to the plaintiffs and the plaintiffs should buy from the defendant five thousand tons of Abermain best screened coal which had before then been purchased by the defendant from the Abermain Colliery Company Limited under a certain agreement made between the defendant and the said Abermain Colliery Company Limited and dated the 23rd day of January 1906 at the price of seven shillings and sixpence per ton upon certain terms and conditions set out in the said contract between the defendant and the said Abermain Colliery Company Limited." It does not appear distinctly whether the contract was for five thousand tons already ascertained, or for the future delivery of unascertained coal, but it was probably the latter. The defendant pleaded as an equitable plea that "before the date of the alleged agreement between the plaintiffs and the defendant the said Abermain Colliery Company Limited had entered into certain agreements with certain persons other than the plaintiffs and the defendant, whereby they had agreed not to supply coal for shipment to South Australia to anyone but the said persons, and the said Abermain Colliery Company Limited had accordingly refused to supply coal to the plaintiffs (1) L. R., 6 Q.B., 597.